China Henan spot alumina price stable; Shanxi may edge up

China's spot alumina price ex-works Henan basis was steady at Yuan 2,520/mt ($408/mt) at 30% credit payment terms on Tuesday, with spot activity for July expected to pick up this week.

Henan refiners' offers were heard at Yuan 2,530-2,550/mt for 30-50% credit payment terms, with tradable prices mostly at Yuan 2,500-2,530/mt cash up to 30% credit terms, refiners, smelters and traders said.

"Henan prices are holding steady as reserves are limited, so prices are not falling. But they are not rising either as aluminum prices stay low and market sentiment stay weak," a refiner source said.

Ex-works alumina prices in neighboring Shandong province were also rangebound Tuesday at Yuan 2,530-2,550/mt on tight spot supply.

"Only one to two refiners are still offering spot now in Shandong, so supply is very tight. Costs are also high due to strong bauxite prices, and all that is supporting alumina there," a Chinese trader said.

In Shanxi, however, alumina prices are likely to edge up in the near term also due to tightening spot supply, sources said.

"Shanxi prices have edged up earlier, together with Shandong and Henan, to the current Yuan 2,470-2,480/mt, from a previous Yuan 2,450-2,460/mt. But today, we're hearing higher talking levels of Yuan 2,490/mt as few refiners are willing to sell," another Chinese trader said.

Meanwhile, Guangxi continues to see the lowest alumina prices in the country due to lower production costs and pressure from abundant supply.

On Tuesday, sources pegged prices mostly at Yuan 2,280-2,300/mt cash, with offers heard at Yuan 2,300-2,320/mt from two major Guangxi refiners, Huayin and Xinfa.

"Due to reduced demand as some smelters in Guangxi had cut back output, and also increased supply as new alumina capacity came online in recent months, there's ample supply now in the region," a source close to a Guangxi refiner said.

"Some refiners and smelters, looking to resell their term supply, have been developing new markets by selling to the Northwest, particularly Xinjiang, where transport costs are high, so they have lowered ex-works prices instead," he added.

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